The industry is growing as developers keep working and customers are searching for a Covid boredom solution
The video game lockdown boom has shone a spotlight on British game makers’ global success, drawing the interest of cash-rich U.S. giants willing to snap up lucrative, pandemic-proof firms.
A surprise £ 945 million bid for Codemasters, the producer of Formula One racing games, was revealed by Electronic Arts, the California-based multinational games giant.
The bid by EA, recommended by the board of Codemasters, is almost £ 200 million higher than that made last month by rival Take-Two Interactive, the developer of games such as Grand Theft Auto, which is expected to join the bidding war with a better bid.
As tens of millions of customers have sought relief from locked-in boredom, the games industry has proven a coronavirus winner and the British pedigree has ensured that optimistic investors have sent shares soaring.
The handful of British game developers listed on the London Stock Exchange have all seen share price rises of more than 100 percent this year, including Warwickshire-based Codemasters.
Veterans of the industry are not surprised by the recent boom, pointing to the British history of world-class games production.
“The UK is a very creative nation, leading the world in film, television, fashion and advertising – and games are no exception,”The UK is a very creative nation, leading the world in film, television, fashion and advertising – and games are no exception. “In the 1980s, there were titles like Elite and Populous, when gaming consoles came along in the 1990s, Tomb Raider and Grand Theft Auto, and now with mobile platforms, games like Fall Guys and Golf Clash. The U.K. has been responsible for creating many global franchises, but outside the industry that value is often not seen.”
EA’s foray into the U.K., actually. The gaming industry is just the new scouting opportunity for a land grab by international corporations.
It was Japan’s Sega; Sports Interactive, the Islington studio behind Football Manager and Championship Manager, more than a decade ago; and Creative Assembly, among others, that produced the Warhammer: Total War series.
Switch the clock back 20 years, and DMA Design, the Scottish developer behind Grand Theft Auto and Lemmings, was picked up by New York-based Take-Two, which currently tracks Codemasters.
The willingness of developers to continue operating practically unimpeded by the virus is an important consideration for investors seeking to support pandemic-proof businesses, in addition to the boom in games.
According to the industry association Ukie, during the pandemic, game makers maintained 80 to 90 percent productivity, none registered a decrease in revenue, and a quarter had to raise employees to keep up with demand.
The British producer of Fall Guys, the multiplayer online athletic tournament Teletubbies-style that has become a global sensation, had to triple its workers.
“When Fall Guys was released in August, we had a core team of about 35 people on the project,” says Dave Bailey, a co-founder of developer Mediatonic. “Nothing could have prepared us for what was going to happen. The game sold more than 11 million copies on PC and became the most downloaded PlayStation Plus game in history in about 60 days. Meanwhile, we have about 100 people working on Fall Guys.”
Although the streaming boom is grabbing attention, led by businesses including Netflix and Spotify, the games industry is as strong as the UK music and video industries. According to the Entertainment Retailers Association, combined, at £ 4 billion. In the U.K. The video game industry, behind gaming juggernauts Japan, South Korea, China and the United States, is the largest in Europe and the fifth largest in the world.
Neil Campling, media analyst at Mirabaud, says, “The ability to create high-quality game content is in short supply,” As with a movie, it can cost more than $100 million to create a top-class title and take up to four years to produce.
But the margins, if done right, can be a license to print money with physical and digital distribution platforms and players purchasing add-ons. For a while, we’ve been anticipating mergers and acquisitions in gaming, we’re seeing the beginning of a surge.
Tax breaks by the government, the billions spent by businesses like Disney and Netflix